Journal file photoThe sale of the Hoboken University Medical Center to a group that owns the Bayonne Medical Center, was been approved at a Hoboken Municipal Hospital Authority meeting last night.

The sale of the Hoboken University Medical Center to the owners of the Bayonne Medical Center has been approved by the group that operates the city-owned hospital.

The Hoboken Municipal Hospital Authority (HMHA) voted last night to approve the sale to HUMC Holdco LLC, a company formed by the principals of the Bayonne hospital to purchase HUMC.

Under the terms of the $91.7 million deal, HUMC Holdco would settle the $52 million debt the city inherited when it took over the hospital from St. Mary. Another $20 million would be spent on investments at the hospital and the remaining money would go toward costs associated with the transaction.

“One of my most important priorities when I took office was to ensure that our hospital would remain a full service acute care facility and to relieve our city of the significant obligations associated with its $52 million bond guarantee,” Mayor Dawn Zimmer said. “This agreement satisfies both of these important objectives and is a significant milestone for our city.”

The sale is far from complete. There will be at least one public hearing and the state must approve the sale.

“This is a significant milestone,” said Toni Tomarazzo, HMHA chairwoman. “... The Authority's request for proposals set forth the Authority's clear objectives: to maintain the facility as an acute-care hospital, to preserve the jobs, to continue the valuable working relationship with the medical staff of the hospital, and to relieve the city of Hoboken of its bond guarantee obligations.

“There is still much work to be done before the transaction can be finalized, but we are optimistic that we will be able to proceed expeditiously toward a closing.”

The city took over the cash-strapped non-profit hospital in 2008 to save it from closure, but assumed $52 million in debt while doing so. Zimmer, who sits on the HMHA board and other city officials had often stated that the city wanted no part in running a hospital.

It is expected that the group operate the facility as a for-profit hospital. Under the terms of the agreement, the facility must remain a hospital for at least seven years and at least 75 percent of the the staff would be kept on.

“The hospital, like many stand-alone community-based medical facilities, faced a challenging fiscal position,” said Steven Rofsky, chairman of the Authority’s Finance Committee. “This agreement will help our hospital thrive while at the same time relieving our city of the risk associated with the $52 million bond guarantee.”